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Can you summarize MNST 336.3-416?
UNIFORM COMMERCIAL CODE > TRANSFER WARRANTIES.
Short Summary
This legal document, governed by the Uniform Commercial Code under the Trade Regulations and Consumer Protection section of the Minnesota Statutes, outlines the transfer warranties for instruments. It states that a person who transfers an instrument for consideration warrants to the transferee and subsequent transferees that they are entitled to enforce the instrument, all signatures on the instrument are authentic and authorized, the instrument has not been altered, the instrument is not subject to a defense or claim in recoupment, the warrantor has no knowledge of any insolvency proceeding, and the person on whose account a remotely created item is drawn authorized its issuance. The document also specifies that a person who took the instrument in good faith and to whom the warranties are made can recover damages for breach of warranty. However, the warranties cannot be disclaimed with respect to checks. Notice of a claim for breach of warranty must be given within 30 days after the claimant has reason to know of the breach and the identity of the warrantor. The cause of action for breach of warranty accrues when the claimant has reason to know of the breach. A claim for breach of warranty in relation to a remotely created item is available against a previous transferor only if all previous transferors made the same warranty. The document provides clarity on the liabilities and rights of parties involved in the transfer of instruments.
Whom does it apply to?
Persons who transfer an instrument for consideration and subsequent transferees
What does it govern?
Transfer warranties
What are exemptions?
The warranties stated in subsection (a) cannot be disclaimed with respect to checks.
What are the Penalties?
Damages for breach of warranty can be recovered, but not more than the amount of the instrument plus expenses and loss of interest incurred as a result of the breach.
Jurisdiction
Minnesota